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Final Essential Health Benefits Rule Expected Out Soon

By Rebecca Adams, CQ HealthBeat Associate Editor

February 11, 2013 -- As Office of Management and Budget (OMB) reviewers do the final check on three significant health rules, lobbyists are anxiously waiting to see whether these regulations will emerge changed, particularly a proposal that outlines the essential health benefits that plans must offer in 2014.

Any revisions to the essential health benefit requirements, which were proposed on Nov. 26, 2012, could make a significant difference in the breadth of coverage and affordability of insurance for consumers. The OMB interagency review is the last stop before a regulation is issued.

OMB officials also are vetting a final rule, proposed Dec. 7, that details how plans' payments would be adjusted to reflect the health of patients, meaning health plans that enroll healthier beneficiaries would have to transfer money to plans with higher-risk enrollees. About $45 billion could be transferred between insurers from 2014 through 2017. That rule also spells out requirements for three-year transition programs governing reinsurance and risk corridors designed to limit plans' financial losses or gains.

The Centers for Medicare and Medicaid Services (CMS) sent both rules to OMB officials last week.

The administration is also preparing to release the rate review rule, which was published on Nov. 26. That rule implements provisions in the health care law (PL 111-148, PL 111-152) that require patients to be offered insurance without regard to pre-existing conditions and that sets limits on how much insurance costs can vary for different individuals. CMS officials had asked for comments on strategies that federal or state officials might deploy to avoid or minimize high premium price spikes. CMS officials sent that rule to OMB on Jan. 31.

Opinions Differ on What Is Essential

People wrote in with about 3,500 comments about the essential health benefits rule—so many that a CMS spokeswoman was unable to say exactly how many responses were filed. Some groups say the proposed benefits are too generous and will be difficult for employers or consumers to afford. Employers are calling on the administration to scale back requirements for prescription drugs, pediatric dental, and vision services, among others.

Others, including consumer groups and hospital associations, say too much emphasis is being placed on providing flexibility and affordability instead of ensuring that coverage is robust.

The public asked CMS for a wide range of changes to the rule. Advocates for coverage for acupuncture, lactation services and care for specific diseases, such as autism, made individual pleas as part of letter-writing campaigns. Others, such as the American Academy of Actuaries, asked CMS officials to be more clear in explaining how state-mandated benefits requirements will be implemented. The actuaries also want to know how the cost sharing will work when covering services that typically aren't offered in plans that states chose as their benchmarks, such as pediatric dental and vision care.

Even members of Congress commented. Rep. Bill Pascrell Jr., D-N.J., urged CMS to "ensure that state-selected Essential Health Benefit Benchmark Plans address the needs of brain injury patients through comprehensive coverage and offer strong protections against discriminatory plan designs." Pascrell recommended that the administration incorporate changes requested from the Brain Injury Association of America. The congressman is the co-chairman of the Congressional Traumatic Brain Injury Task Force.

One major flashpoint is the coverage of drugs. The proposed rule requires that plans cover at least one drug in every category and class, or the same number of drugs in each category and class as the state's benchmark plan, whichever is more. That raises the possibility that more than one drug in every class will be covered and potentially that many more drugs will be paid for.

A number of patients' groups urged CMS to expand coverage so that more than one drug is always covered.

"Patients need access to a wide range of prescription drugs, as they do not respond to a specific number of drugs but rather to specific drugs that best meet their needs as prescribed by their physician," wrote representatives of the American Lung Association.

Several groups, including the National Alliance on Mental Illness and AIDS advocacy groups, proposed adopting a system that the Medicare Part D prescription drug program uses. That program has identified six classes of drugs for which federal officials say it is important for patients to be able to choose from a wide range of drug-based treatments.

Many groups also expressed concerns that insurers would limit coverage to only generics or particular treatments. A variety of patient groups asked that CMS spell out that insurers will have to cover combination therapies, in which two or more medications treat a single disease.

But a number of employer groups are pushing CMS in the opposite direction, that of reducing coverage. The Essential Health Benefits Coalition, which includes groups such as the National Association of Manufacturers, said the coverage in the proposed rule could drive up costs so much that individuals and small businesses may not be able to afford the insurance.

The public should find out soon what conclusions CMS officials have reached. Health and Human Services Secretary Kathleen Sebelius has said in the past that the final rule will be out before the end of February, a commitment that seems likely, given OMB's review, and was recently confirmed by a CMS spokeswoman.

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